GT finds support at 20-day moving average
The Goodyear Tire & Rubber Company (GT) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
GT finished the week 11.91% higher at 7.14 after edging higher $0.06 (0.85%) today, outperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Trading up to $0.26 lower after the open, the share managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on May 15th, GT gained 10.97% on the following trading day. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (GT as at May 22, 2020):
Friday's trading range has been $0.37 (5.24%), that's below the last trading month's daily average range of $0.49. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for GT. Prices continued to consolidate within a tight trading range between 6.67 and 7.35 where it has been caught now for the whole last trading week.
Two candlestick patterns are matching today's price action, the Hanging Man and the Last Engulfing Top Pattern which are both known as bearish patterns.
After trading as low as 6.80 during the day, The Goodyear found support at the 20-day moving average at 6.87. Prices are trading close to the key technical resistance level at 7.21 (R1).
The market shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying could speed up should prices move above the nearby swing high at 7.35 where further buy stops might get triggered.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Last Engulfing Top Pattern" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for The Goodyear. Out of 75 times, GT closed higher 50.67% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after three trading days, showing a win rate of 54.67% with an average market move of 0.27%.